To legally set up a trucking business, it is essential to be authorized by the government to carry forward trucking operations. In this respect, the types of authorities i.e. DOT authority and MC authority, are important. This blog post will discuss things you should know about these two types of authorizations in the trucking industry.
A moving truck company that moves on an interstate basis is given a USDOT number (U.S. Department of Transportation number), which serves as both a unique identification number and interstate operating permission, by the FMCSA. A moving company’s safety records, including registration status, compliance evaluations, ratings, inspections, crash investigations, and more, are tracked by the government using DOT Authority.
The FMCSA issues moving firms engaging in interstate commerce, or transporting goods across state borders, an MC number (Motor Carrier number), which serves as both an interstate operating authorization and a distinctive identity. While all interstate movers must have and show a USDOT number on their business vehicles, not every moving company is obliged to have an MC number.
How to Get Your Commercial Driver’s License
1. Register your company with the relevant county or state
You will need to complete this registration depending on where you intend to operate. You must decide on a legal structure for your trucking company and make tax preparations. Determine if your state needs you to file your DBA at the county or state level if you want to operate as a sole proprietorship with a DBA. You must complete and submit the proper documents to the Secretary of State’s office if you create an LLC or Corporation to reduce your personal responsibility.
You may file your LLC or corporation online in several states. After your firm has been registered, maintain copies of all the documents and licenses. You will need this information for a lot of the additional papers you submit to get on the road. Since no two businesses are similar, it is advised that you seek out experts who can provide you with reliable advice about which business structure is best for you.
2. The acquisition of an Employer Identification Number (EIN)
You are legally required to get an EIN issued by the IRS if you are an LLC or corporation. It is advised that someone working as a single proprietor also get an EIN to ensure privacy. The single proprietor must utilize their social security number without an EIN, which puts them at risk of identity theft.
3. Register with the US Department of Transportation (USDOT)
The USDOT requires all trucking businesses, from heavy-duty commercial trucking to food truck industry to register. Consider this to be the ID or File number for your business. You can check your company’s vehicle, cargo, safety, and compliance information with your USDOT number. You are not given the right to engage in interstate trade. There are a few things regarding your trucking firm that you should be aware of before during the registration procedure, such as:
- In what cities will you be working?
- How many trucks are you planning to use?
- Which kind of vehicle will be utilized? And more.
Any shippers you haul for can access this data because it will be filed under your USDOT number. Along with your USDOT number, you will also receive a PIN. Any subsequent modifications you make to the USDOT or FMCSA will require your PIN. You must renew your USDOT number if any changes occur in the details you provided to the authority.
4. Visit the FMCSA for a Motor Carrier Number
You will be able to engage in interstate commerce with an MC#. To finish your application, you will require all the data you acquired for the USDOT registration. Your MC# will be issued to you right away, and you’ll have 20 days to complete the next two stages after receiving your MC#.
Your authority will become operational in around 2-3 weeks once those 2 things are on file with the FMCSA. You won’t receive your Authority certificate in the mail for another two weeks or more. Until that MC# is valid and your BOC-3 and Insurance are on file with the FMCSA, you are not permitted to engage in Interstate Commerce.
5. Create a new IFTA account
The lower 48 states of the United States and the provinces of Canada have signed the International Fuel Tax Agreement (IFTA), which makes it easier for motor carriers that operate in many countries to report their fuel usage.
You must submit your fuel tax report, including all kilometers driven in all participating jurisdictions as well as gasoline purchases, by the end of the fiscal quarter. Also, identify the states you want to transport goods into and the approximate miles on this form, which is quite similar to the IRP form.